Regarding retirement of director of pvt co. by rotation

Pvt ltd 1548 views 2 replies

sanjay kumar

Trainee

44 Points Joined March 2012

As per sec 256 the provision relating to retirement by rotation is not applicable to Pvt Co.unless otherwise provided by its AOA.

How we should interpret if it is written in article that, "All the Directors liable to retire by rotation, if any, shall be entitled for reappointment" but nothing mentioned in the Article that which Director is liable to retire by rotation.

1. will the Directors of a Pvt Co. be liable to retire by rotation if nothing is mentioned in its Articles?

2. Whether first Directors of a Pvt Co. be liable to retire by rotation?

3. There are 2 Directors only n subsequently we appoint an additional Director n we regularize him in the AGM as a Director but resolution for his appointment is silent regarding his retirement i.e, whether he is liable to retire by rotation or not. will he be liable to retire by rotation as per its article?

Replies (2)

Ankur Garg

Company Secretary and Compliance Officer

114783 Points Joined January 2009

As per my understanding retirement by rotation is absolutely not applicable to your private company even if the clause mentioned by you is there in the AOA.

However this clause is not required in your AOA, so as per my suggestion remove this clause by altering your AOA.

AOA should be specific regarding retirement by rotation provisions. Deemed retirement by rotation is not possible in a private company.

Regards

Muralidharan

Self Employed

1034 Points Joined December 2008

Dear Member

The Article which is available in your articles of association is a enabling clause.

For example your company appoints an additional director whose appointment is subject to be regularised by the members at the next AGM.

At the AGM the members while approving / regularising his appointment may pass a resolution putting a condition that such director is liable to retire by rotation. In such situation the said director is liable to retire by rotation.

As rightly pointed out by Mr.Ankur Garg this clause is not necessary in your AOA. It would be appropriate to alter the Articels and remove the above said clause if the board and members of the company thinks it fit.

with regards

Muralidharan